Reaping The Email Personalization Payoff
Data prove personalized email succeeds, but many businesses aren’t applying it. Columnist Steve Dille explains why, and how to get your company on board.
Even if you were making a strictly intuitive argument about applying the power of Big Data personalization to email marketing, it would still make sense: Any of us respond better to a personalized query, a sales pitch that hits our individual pain points or aspirations, the right offer that arrives at the right time …
But, of course, there’s plenty of data to make the case, too:
- Experian’s 2013 Email Market Study showed personalized subject lines delivered 26 percent higher unique open rates overall, with travel companies experiencing the “biggest boost” from personalized subject lines — 65 percent!
- The same study showed how personalized promotional emails listed transaction rates and revenue per email six times higher than non-personalized emails.
- According to Aberdeen, personalized emails improve click-through rate by an average of 14 percent and conversions by 10 percent.
- Listrak found that 77 percent of consumers are likely to make additional purchases if an option that matches their preferences is presented to them in a personalized email from a merchant or retailer.
- 80 percent of marketers define dynamic personalization in emails as highly important, according to a study by Adobe and the Direct Marketing Association.
But despite that last stat, the Experian study also found that:
- 70 percent of the responding brands admitted they’d failed to personalize their email messages.
- Only 35 percent asked customers how often they wish to receive emails.
- 60 percent didn’t give customers options on what type of emails they wanted to receive.
So if email personalization works, why aren’t more enterprises adopting it?
Challenges Facing Adoption
It’s not always out of ignorance or pigheadedness. There are challenges — some big, some small, but none of them unbeatable — that can hobble adoption of personalized email:
1. Big Data As A Big Hurdle: I recently had the pleasure of sharing a webinar with Mike Gualtieri, a principal analyst at Forrester Research, for an American Marketing Association (AMA) session on the “Dos and Don’ts of Data-Driven Email Marketing.” He pointed out that most tech decision-makers “get” what Big Data represents, but Big Data is compiled of lots of separate sources: structured text (clicks, XML, relational databases), unstructured text (emails, tweets, blog comments), even binary data (audio, images, video, maps).
When Forrester asked companies how much of their enterprise data was being used for analytics, it turned out that only 12 percent of their available data was being utilized, because it’s typically siloed across different divisions, operations, databases and more.
So integrating that data behind a concerted email marketing initiative can be a sizable commitment for some organizations.
2. Got (Good) Data?: Personalization takes, well, personal data on each individual, and marketers may lack it in the first place. They might have never prioritized capturing usable personal data, or had poor opt-in or registration forms, or didn’t integrate market intelligence or data-mining tools that could attach a more rounded profile to a name and email address.
A 2014 Neustar and Digiday study found that 33 percent of marketers cited poor or incomplete customer data as the biggest roadblock to personalization.
3. Know How To Use It: Having a wealth of data available can be a daunting obstacle in and of itself if a marketer hasn’t constructed a solid segmentation strategy to help effectively leverage each segment’s interests.
Seventy-four percent of consumers get frustrated when online content has nothing to do with their interests, and that applies to email, too.
Does building a segmentation strategy take time and effort? You bet. But the higher open rates are a nice carrot.
4. Activation Angst: The same 2014 Neustar study said 53 percent of digital marketers always or often struggle with personalizing their marketing efforts on a large scale, with 26 percent claiming difficulty turning their data into action; 15 percent struggled to identify customers across different devices.
These are the kind of migraines that can spring from internal issues, but they also often point to not having the right email marketing platform in hand. Older, cloud-based segmentation tools (and their associated headaches) are being supplanted by API (Application Programming Interface)-based marketing and analytics automation, where predictive modeling can drive real-time personalized messaging without you having to lift a finger.
Building An Enterprise Argument
Whether you’re simply working to convince yourself, as an entrepreneur or decision-maker, to make a commitment to email marketing personalization, or trying to convince others in the enterprise to embrace it, you can recommend a series of steps to smooth the path:
- Run the numbers: Project just how much your business will benefit from the kind of upticks quoted in the Experian study or other resources.
- Walk first, then run: First implement Big Data personalization techniques across a single brand, program or channel, then with another, and another, then more of them as your proficiency grows.
- Connect your marketing systems: The reward that comes from culling data points from all those presently scattered fiefdoms around your enterprise will be more than worth the price.
- Build a segmentation strategy: Identify your target audiences and the interests you can leverage. One great byproduct: It’s usable beyond just email marketing.
- Shop the platforms: There’s an entire expanding universe of different Big Data email marketing tools and vendors out there to compare, analyze and align against your specific enterprise requirements — and not the other way around. Find the one that suits your exact needs and budget.
- Consider evolving to an API-based email approach from a SaaS campaign management approach: As mentioned above, APIs can expedite email marketing by integrating multiple tools — like your CRM or customer service systems — into a platform capable of truly personalizing your emails based on data. You’ll get quicker, more targeted execution and response, and reduce employee costs while doing it.
- Show the research: I’ve cited just some of it, and there’s a flood of other data out there ratifying the effectiveness of personalization.
- Audit the competition: There’s a good chance that one or more of your competitors are adopting personalization as a critical path in their email marketing efforts. Spy out what they’re doing, and what sort of payoff they’re likely realizing.
Personalize Or Perish?
The hard truth is, personalization is the oncoming norm for every digital marketer: Consumers increasingly expect relevant, individualized engagement, and failing to deliver it in email will increasingly consign your messages to the spambox.
But even putting aside the real risk of your email campaigns capsizing by ignoring this tide, the potential payoffs personalization and Big Data integration offer make the evolution totally worth the effort.
Plus, as email marketers and technologists find more ways to create eye-to-eye, heart-to-heart dialogues with audiences, those payoffs will only get better.